Business News 16th June 2017

We hope you enjoy reading the business news compiled by the Credit Protection Association on Friday 16th June 2017 for its members and visitors.

Bank of England keeps rates on hold

The Bank of England has unsurprisingly kept interest rates on hold at 0.25%. But in a shock to the market, three of the BoE’s rate-setting committee voted for a rate rise. The 5-3 vote by the BoE’s policymakers was the closest for a rate rise since 2007, and comes with inflation close to a four-year high of 2.9%. Analysts at Capital Economics commented: “The more hawkish tone of the MPC appears to reflect some concern about inflation – which has accelerated faster than it expected over recent months and is now forecast to exceed 3% this year – as well as the strength of employment that is continuing to erode slack in the labour market.”

The Guardian, Page: 32 The Daily Telegraph, Business, Page: 1, 3 The Times Financial Times, Page: 3 Daily Mail, Page: 28

Small businesses’ confidence in May collapses

The Daily Telegraph Business Tracker has revealed that small businesses are increasingly disillusioned with Theresa May’s government. The Tracker, which follows companies and business people online to monitor their social media postings, showed SMEs had a positive view of the future in February. Some 42% of businesses appeared to feel positive while just 7% were downbeat, leaving a net balance of 35%. However, the latest analysis shows just 9% are upbeat while 35% are negative, dragging the overall sentiment indicator to minus 26%. Meanwhile, Russell Lynch in the Standard says the election result is likely to discourage businesses from investing in the UK.

The Daily Telegraph, Business, Page: 8 Evening Standard, Page: 59

Public supportive of tax rises to bolster NHS funds

A poll commissioned by accountants PwC has found that 66% of the public are supportive of tax rises to pay for improvements to NHS. Seventy-six per cent of those aged 65 and over backed such increases, compared with 56% of those aged 35-44 and 61% of those aged 18-24. The survey of 2,000 adults, conducted by BritainThinks, also found that four in 10 would like to see charges for patients who miss appointments.

The Daily Telegraph

Government to step up business funding

The Government is to increase the level of financial support it provides to business ahead of the UK leaving the EU. Ministers are in discussion with the European Investment Bank to ensure UK projects can access its funds during the remaining period of Britain’s EU membership. And the British Business Bank is set to extend the limits of its venture capital investment programme to enable it to provide greater levels of investment into individual funds.

The Independent Evening Standard, Page: 12-13

Shearer settles over ‘negligent’ financial advice

Alan Shearer has agreed a settlement with a financial adviser and a specialist pension firm he had accused of giving him “negligent” advice. The former footballer had been claiming £9m in damages. Barrister Gerard McMeel, who led Shearer’s legal team, said the terms of the agreement were confidential.

Daily Mail The Sun, Page: 29

GDPR could cost banks €4.7bn in first 3 years

European banks could face fines totalling €4.7 billion in the first three years under the new General Data Protection Regulation (GDPR), a new report has found

Fstech

Overseas stars miss out on tax break

Cricketers competing in the Champions Trophy will be required to pay UK income tax on their prize money, unlike footballers who played in this month’s Champions League final, after the ECB failed to negotiate an exemption ruling with HMRC.

The Times, Page: 76

Farmers urge end to tax breaks for rich

George Dunn, chief executive of the Tenant Farmers Association, says “scandalous tax breaks” have turned the countryside into a giant haven for City money and made it virtually impossible for young farmers to get started.

The Times, Page: 26

Public sector staff pay twice as much into pension pots

Figures from the Department of Work and Pensions reveal workers in the public sector are saving an average £8,418 into workplace pensions – twice as much as those in the private sector.

Financial Times

Wealthy turn their backs on offshore tax havens

A survey by Wealth-X reveals the number of wealth managers offering UK investors offshore services dropped by a fifth in 2016, compared with the previous year. Research by Wealth-X also found few wealth managers are planning to offer robo-advice to their customers, despite an increasing number of digital upstarts entering the wider market.

Financial Times

Lenders crack down on “secret” buy-to-lets

The Telegraph reports that banks and building societies are taking a keener interest in whether borrowers are renting out properties without their permission – from increased scrutiny at the mortgage application stage through to data-sifting techniques similar to those used by HMRC to spot tax evasion.

The Daily Telegraph

Alcohol fraud arrests

Six people have been arrested on suspicion of money laundering as part of an HMRC investigation into a £440m alcohol duty fraud.

The Times, Page: 12 Independent i, Page: 2

Greece

For the best part of a decade, Greece has wanted to become a “normal” country, and yesterday it appeared to begin that process, after creditors agreed to disburse €8.5bn (£7.4bn) of bailout funds aimed at putting the debt-stricken nation back on the road to recovery. The money, signed off after months of disagreement between the European Union and International Monetary Fund over how to reduce Athens’ staggering debt pile, will be released in July, once European parliaments ratify the deal.

Asian Markets

Asian Shares advanced, led by a rally in the Topix as the yen held losses after the Bank of Japan left monetary policy unchanged.

U.S. Markets

U.S. Shares closed lower as tech firms weighed and the market digested rate rise news.

Oil

Oil prices were not far off six-month lows, held down by an ongoing supply overhang that persists despite an OPEC-led effort to cut production and prop up crude markets.

Gold

Gold edged lower on Friday to hit a three-week low and was on track for a second weekly fall, dragged down as upbeat U.S. economic data supported the dollar.